The life of an online entrepreneur

Li Lianzhong, head of the Chinese Communist Party’s policy research office, voiced his opinion today about what China should do to reduce its exposure to the greenback. The article offers some clues about what China’s strategy may be, which likely includes a larger role for gold and other hard assets instead of worthless paper.

Li claims the US dollar is poised for a fall, and adds that China should buy more gold to support the greater international role envisaged for the yuan. Furthermore, Li stated that China should use more of its $1.95 trillion in foreign reserves to buy energy and natural resource assets, a strategy the country has already been following a lot lately.

Speaking at a foreign exchange and gold forum, Li also said that buying land in the United States was a better option for China than buying U.S. Treasury securities.

‘Should we buy gold or U.S. Treasuries?’ Li asked. ‘The U.S. is printing dollars on a massive scale, and in view of that trend, according to the laws of economics, there is no doubt that the dollar will fall. So gold should be a better choice.’

There is no suggestion that Li, even though he is a senior researcher, was enunciating an agreed party line.

I’ve been reading a lot lately, and one of the interesting sites I’d like to share is the brief history of money from Garmarley. It’s a compilation of some of the monetary follies of the past, starting in 700 BC in Greece and ending with the episode of hyperinflation in the Weimar Republic.